What is an organization?
Organizations are social entities that are goal directed, with deliberately structured activity systems, and with a link to the external environment.
Types of Organizations
We will study both large and small organizations. We will also look at manufacturing and service organizations, for-profit and nonprofit organizations.
Importance of Organizations
Organizations create value for owners, customers, and employees by their activities. They bring together resources to accomplish specific goals, whether those goals are putting on the Olympics or planting new trees in the city. Organizations produce goods and services, using innovative ...view middle of the document...
Dimensions of Organization Design
Structural dimensions provide labels to describe an organization's internal characteristics. Formalization pertains to the amount of written documentation in the organization; Specialization is the degree to which organizational tasks are subdivided into separate jobs; Hierarchy of authority describes who reports to whom and the span of control; Centralization refers to the hierarchical level that has authority to make a decision; Professionalism is the level of formal education and training of employees; Personnel ratios refer to the deployment of people to various functions and departments.
Contextual dimensions characterize the whole organization and describe the organizational setting. Size is the organization's magnitude as reflected in the number of people in the organization; Organizational technology refers to the tools, techniques, and actions used to produce the organization's products or services; Environment includes all elements outside the boundary of the organization; Goals and strategy define the purpose and competitive techniques that set it apart from other organizations; Culture is the underlying set of key values, beliefs, understandings, and norms shared by employees.
Performance and Effectiveness Outcomes
An organization must learn to be efficient-using the least amount of resources to achieve its goals, as well as effective-the degree to which an organization actually achieves its goals. In doing this, the company must consider its stakeholder who are any group within or outside the organization that has a stake in the organization's performance. Typical stakeholders include employees, customers, creditors, management, government, unions, the community, suppliers, and owners and stockholders [Exhibit 1.6].
The Evolution of Organization Theory and Design
Organization design has varied over time in response to societal changes. The classical perspective remains the basis of management theory today. One classical subfield, pioneered by Frederick Taylor, was the closed system approaches of scientific management. Through scientific procedures in 1898, Taylor identified correct movements and tools for loading four times as much iron or steel for the Bethlehem Steel plant. Administrative principles focused on the total organization based on insights of practitioners such as Fayol. Bureaucracy was an effective approach for the needs of the Industrial Age, calling for clearly defined authority and responsibility, formal recordkeeping, and uniform application of standard rules. It remained the primary approach to organization design through the 1980s. The Hawthorne Studies led to a revolution in worker treatment from findings that positive treatment improved motivation and productivity. Contingency theory means that one thing depends upon other things, and for organizations to be...